Local government institutions are less powerful in South Asian countries with Bangladesh lagging far behind in mobilisation of local level resources due to reasons like conflict in power.
Poor revenue generation mechanism, lack of capacity of regulatory authorities and tendency of staying in comfort zones by elites are also identified as causes for unimpressive management in finance and local service delivery in the region.
The observation came during the last session of the two-day South Asia Economic Network Conference concluded in the capital on Sunday.
Executive Director of Policy Research Institute (PRI) Dr Ahsan H Mansur, Advisor to Prime Minister of Pakistan Dr Ishrat Husain, Chairperson of Indian Council for Research on International Economic Relations Dr Isher Judge Ahluwalia and Executive Director of South Asia Network on Economic Modelling (SANEM) Dr Selim Raihan shared experiences as panel experts in the session moderated by World Bank's Chief Economist for South Asia Dr Hans Timmer.
SANEM, South Asia Economic Policy Network and the World Bank jointly organised the fourth conference that began on Saturday with the title 'Subnational finance and local service delivery'. Participants from India, Nepal, Pakistan, Bangladesh and Sri Lanka attended the conference.
The panellists at the last session on 'Challenges, lessons and remedies in South Asia' observed that staying in comfort zone by elite groups, accepting reforms, lack of capacity of regulatory authorities on various aspects and policy paralysis are the reasons for poor engagement of local governments in national development.
They also said reflection of rapid changes in the world including technology and market intelligence are also absent in local level due to not giving importance on decentralisation and policy regulation.
Dr Ahsan H Mansur focused on proper performing of civil service though it has super authority and very attractive benefit packages in Bangladesh compared to other countries. He alleged that civil service is not running efficiently.
He also said none want to come out from their comfort zones as they enjoy power and benefit.
Though there is no single solution to ensure local government finance and improving service delivery, Dr Ishrat focused on engagement of experts including engineers, architects and town planners. A combination of rapid urbanisation, growth of educated middle class and role of media may bring changes, he stated.
Dr Isher of India, however, underlined the need for free media which can engage civil society as the change maker.
Dr Selim Raihan stressed the removal of policy paralysis as elites do not have any appetite of reform and real change.
Earlier, in a lecture on 'Bangladesh local government public financial management system assessment', Dr Ahsan H Mansur highlighted the factors causing ineffective functioning of local government institutions which include lack of political, administrative and financial autonomy and weak governance.
The executive director of PRI said city corporations have better command over resources than other LGIs (local government institutions). Upazilas collectively account for 27 per cent of total LGI spending but per unit spending by upazilas are very low as the amount is adjusted among all the upazilas across the country.
Weak fiscal decentralisation contributes to grossly inadequate resources that in turn lead to poor capacities of LGIs to deliver services, Dr Ahsan added.
Though the government has recognised the importance of efficient management of public financial resources, the public financial management (PFM) reform did not take teeth and large gaps remained, he further said.
This is due to capacity constraints in the government and lack of adequate policy, he stated.
The conference also held sessions on "The role of fiscal decentralisation in improving education and health," "Social networks and local service delivery," "Why contacts matter: Local governance and the targeting of social pensions in Bangladesh".
Among others, Member (Senior Secretary) of General Economics Division Professor Shamsul Alam, Megha Rao of Indian Institute of Management, Mutawakkil Ahmad Abbasi of Pakistan Institute of Development Economics, Pakistan, Ashani Abayasekara of Institute for Policy Studies, Sri Lanka, Assistant Professor of National Institute of Public Finance and Policy of India Dr Manish Gupta, SANEM Chairman Dr Bazlul Haque Khondker, Research Economist of SANEM Sunera Saba Khan, Joint Secretary of National Natural Resources and Fiscal Commission of Nepal Dr Gopi K Khanal, Director General of Bangladesh Institute of Development Studies (BIDS) Dr KAS Murshid, Professor of Department of Economics of University of Dhaka Dr Atonu Rabbani and Saheli Bose from Jadavpur University, India took part in various sessions.
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